A new leader doesn’t mean a new organisation

When a new leader walks in, the organisation doesn’t start from zero.

As someone financially invested in Unilever HUL and Bajaj Electricals Ltd, and emotionally invested in WPP, because advertising is an industry I have spent much of my career in, I have been watching what has been happening at all three companies with particular interest.

Different businesses, different circumstances and different leadership transitions. But as an outsider, I find myself noticing a common organisational pattern.

Bajaj was led by Anuj Poddar when the stock was close to ₹1,400. HUL touched almost ₹2,900 during Rohit Jawa’s tenure. Both trading at much lower levels currently. WPP transitioned from Mark Read to Cindy Rose OBE, lots changed there too. Priya Nair has taken charge at HUL, Sanjay Sachdeva at Bajaj Electricals.

I am not privy to what happens inside these boardrooms. Boards have their reasons, and new leaders inevitably bring a new perspective, priorities and a new set of measurements.

But there is something organisations often forget when leadership changes. The organisation does not change overnight just because the leader does.

I help business leaders find the growth levers. And one thing I have learnt is that the answer is not always outside — in a new market, a consumer segment, a technology or a strategy. Sometimes, it is already sitting inside.

I experienced this with a client where the organisation was looking at the market to understand why growth had stalled.

While we started digging into the numbers, we also looked across the organisation and uncovered a production–sales conflict.  The growth lever here was sitting between two teams inside the organisation.

That brings me back to leadership transitions. Every outgoing leader leaves behind more than a strategy.

There are people who participated in those decisions, who supported those priorities, who built relationships around them and people who developed their own ways of working.  There are alignments, loyalties, friendships and institutional memories. Then a new leader arrives.

If the transition is handled with animosity, the new leader can almost unconsciously inherit a brief to undo the past. But the people who helped build the past are often the same people expected to execute the future.

There is a temptation for every new leader to believe that a few new metrics, a new structure, a new strategy or a new operating model can reset the organisation. But organisations are not spreadsheets. They are accumulated human behaviour.

Before changing everything, understand why everything became what it is, before replacing people, understand the history those people carry, before declaring the past wrong, understand the circumstances in which those decisions were made and before reaching for the magic wand, look around the table.

The next growth lever may not be somewhere out there. It, as I said in the past could be sitting across from you.